How to Save Money

The odds are, this little article will change your life.

If you’re bad with money — it’s for you. If you’ve always been struggling to save anything — it’s for you. If you always seem to be running out of cash no matter how much more you make — it’s for you, too.


Since this is a cryptocurrency blog, I’m writing this piece as an answer to a staggering number of requests I get on the subject of how to save for a crypto investment. But if you happen to fall under one of the above category, you will reap the benefits from what you´re going to learn today, even if you´re not into crypto.

Before I get to the bit where I show you what is up with your current spending habits — or the lack of it, let me tell you a story first. So you know, it’s a true story. After all, it’s about me.

embarrassed-emoji-bulltrapThe game changer

For the first five years of my adult life, I´ve been a terrible spender. Always struggling to make the ends meet. Simply put, I couldn’t help myself. It was all about the instant gratification — as soon as I got my hands on the paycheck, it was like going on a rampage with my debit card, just to regret it shortly after.

You’d think it’s a lesson learnt and not to be repeated. Far from it. Another paycheck, another rampage, another regret. Rinse and repeat, for half a decade. It wasn’t a downward spiral of a terrible cycle anymore, it was a way of life.

I didn’t understand the difference between the stuff I wanted, the stuff I needed, and the stuff that had to be taken care of in the first place. Much less the need of generating wealth. My money management was all over the place, accompanied by no structure whatsoever, and it had led me to a financial hole I took a couple of years to come out from.

I must admit that I did have some brakes in place at the time. I’d never spend all of my money in one go. That wasn’t the case. I made sure, for one reason or another, that I had just about enough to cover my basic living expenses. I never starved, I was never homeless and I never had to borrow anything to survive.

And that’s the biggest financial disguise I have ever pulled on myself. I thought I was doing alright because I had new fancy gadgets, a nice car, expensive clothes, but close to zero in my bank account at the end of every single month without fail. That’s some consistency if you ask me! Too bad this consistency had a negative impact on my life.

The instant gratification stuff was keeping me happy because it was tangible. I could see it with my own eyes. I could touch it. A lot of people were fooled about my wealth. Why wouldn’t they? All this flashy and lavish lifestyle, he surely must be doing well for himself. I heard such comments way too often, but the only person I was fooling was myself.

I’m not even going to go into details on how difficult it was to financially accommodate all of the annual events such as birthdays, xmas or holidays. Those were clearly cutting into my money at large and I oftentimes skipped most of them for the obvious reasons.

I was blaming everyone, but myself for it. The school and my parents bore the biggest brunt for my financial misery. I say school because money wasn’t taught in there, and the parents because they never instilled a proper discipline and an idea of the delayed gratification in me.

The day I had taken the full responsibility for my life choices was a game changer. I sort of reverse-engineered what I was good at. Remember the negative consistency? I figured that if I was to employ the same consistency in a structured way of managing my money, things would have taken a positive turn.

And they did. That day was the first day of the rest of my life. And it can be yours, too — starting from today. It’s not hocus pocus black magic pull a rabbit out of a hat antics of a new approach. It doesn’t even require you to be an averagely disciplined person.

All you need to do is to stick with one money management principle — distribution of income.

The distribution of income imposes a structure on your finances. Without it, it’s like driving a car in a foreign country without a satnav — you will get somewhere, but most likely, not where you originally intended.

eureka-png-3What is a distributed income?

In short, it’s how you delegate your funds as soon as they arrive in your bank account.

Now, here’s the important bit. You probably have a vague idea on how much you’re spending on accommodation, utilities, food, transport and other necessities as well as the remaining items on your expenditure list. The key word here is vague, because most people think they know, but they don’t. Do you have the exact numbers? If you do, well done — it will make it easier for you. If you don’t, make a list.

The best list you can make is based on a spending app on your phone where you track every penny you spend on a daily basis. It will give off a true amount of money you spend within a month. Once you have that, you also have your list. However, if you want to start now, you can make a list based on your most recent bank statement, and make sure you take into account all of the cash expenditure as well.

Normally, you start with something like this:

  • Accommodation (mortgage, rent etc.)
  • Utilities (gas, electricity, water, internet, phone etc.)
  • Food (lunch, snacks, household food, take outs, restaurants etc.)
  • Transport (public, car lease, fuel, Uber etc.)
  • Education (books, courses, subscriptions etc.)
  • Essentials (cleaning products, toiletry, haircut etc.)
  • Entertainment (cinema, theatre etc.)
  • Debts (credit cards, loans etc.)
  • Gifts (well, whatever she’s happy with!)

This should paint you a clear picture of what you’re after. Once you have your numbers in place, start delegating your income.

So you know, it doesn’t matter how much you make. You can always find a way to save money once you start following this approach, unless your expenses are far exceeding your income.

Now, it’s important to recognize one crucial aspect to this philosophy — what frequency you receive your money at. Is it daily, weekly or monthly? It’s important you don’t skip this step as you have to delegate your income based on this frequency.

For example, if you get paid on a daily basis, you delegate daily. If it’s weekly, you do it once a week. And lastly, if it’s every month, you do it monthly.

Presume you get paid daily, the old fashioned way — cash in hand. This is the most dangerous form and frequency of payment, because it brings about the nastiness of instant gratification and false protection.

Why? You can spend it on fluff within the same day, and you get a twisted sense of protection from not having enough because you’re getting paid again tomorrow so it’s okay.

Presume you get $200 a day. As soon as you get your hands on it, you delegate. You know that you spend this much on a monthly basis for the following items:

Accommodation — $800

Utilities — $350

Food — $600

Transport — $700

Education — $120

Essentials — $150

Entertainment — $350

Debts — $500

Gifts — $200

Total: $3,770

These are obviously fictional numbers. But let’s go ahead with this example to show you how to delegate your money.

In normal circumstances, a person works 23 days within a month. Given your $200 pay per day, this assumes your incoming funds at $4,600. Your monthly outgoings sit at $3,770 which leave you $830 hanging about at the end of each month.

groups-of-cashGroup your outgoings by priority

What you need to do is to bundle the items from the list above into several groups and give each group a name. I have personally created five saving accounts that are linked to my main current bank account, and named them after the planets closest to the Sun: Mercury, Venus, Earth, Mars and Jupiter.

The planet that’s the closest to the Sun — Mercury — holds the dead money. The money that is burnt whether you like it or not — rent, utilities, car lease, debts etc.

The second one, Venus, is for the stuff you need to get in order to survive, but can also cut down on if need be — food, education, transport, essentials. By transport, I mean maybe have a walk instead of driving to get the groceries if the shop is around the corner etc. You know what you can cut down on, I can’t tell you that, but you get the gist.

The third planet, Earth, is the money you have access to if you need to spend it on the less important items such as entertainment, gifts etc.

Mars, the fourth planet, is your delayed gratification fund towards something you think you need or want. It could be whatever, be it a crypto investment or a new phone — it doesn’t matter. It’s yours to have in due course.

And lastly, Jupiter, is your savings. That’s where you lock away your money without touching it.

Delegate funds by numbers

Calculate how much money you need to save on a daily basis in order to accommodate your expenditure obligations.

Mercury — rent, utilities, car lease, debts that all amount to $2,000 per month (with $350 being the car lease).

If you divide $2,000 by 23 working days, you need to save $86.95 every working day to cover these expenses. Now, save a round $100 towards it so you can generate a surplus. This will eventually build up a large enough pot over a long period of time that you can use to take care of your priorities whilst you’re on a 2-week holiday for example. To give you a perspective, by doing this on a 12-month period, you will have saved $27,600 including the surplus, but your obligation is only $23,998 which leaves you a comfortable $3,601. This extra money is a month and a half worth of Mercury expenditure.

Venus — food, education, transport and essentials that add up to a monthly payment of $1,570.

Do the same as above, and divide $1,570 by 23 days which equals to $68.26 that you must save on a daily basis to cover Venus. Now, round it up to $75 to make surplus which will work out to be an annual $1,861 of a cushion for the rainy days.

Mars — cryptocurrency investment of $300 a month.

$300 divided by 23 days is $13.04 a day. For your delayed gratification goals, you don’t necessarily have to generate a surplus. Once you save up the full $300, you spend it and start over.

Jupiter — save up $200 a month.

$200 divided by 23 days is $8.69 a day. Stash it away and don’t touch it. It will build up to a large sum of money in a long haul.

Total for all: $4,525 including surplus

Once you start taking care of your finances as described above, you will be able to pay for your priorities, get yourself what you want, save up and accumulate wealth over time.

Now, these are rigid numbers and you won’t be spending the exact amount of money each month on food, restaurants, fuel, gifts etc.

That’s where the Earth group comes in. Whatever is left after paying for Mercury, Venus, Mars and Jupiter (in this order), the rest goes into Earth which gives you free money that you can either spend on the stuff you didn’t account for or you simply delegate it into building a larger surplus for the group of your choosing.

Make the numbers work

If you can’t make the numbers work, try lowering the surplus for the first two categories. Or better yet — examine your monthly outgoings and try cutting down on the fluff. Everyone spends money on fluff, you’re not the only one, but it varies in degrees. Figure out how you can save on things you don’t need.

It doesn’t matter how much you’re making. It might be the case you comfortably make more than you spend without delegating your money as proposed above — the odds are, you could save up more towards certain goals once you take control of your finances nevertheless.

It also doesn’t matter how frequently you’re getting paid. The example above shows the numbers as if you were paid on a daily basis. If you get weekly or monthly paychecks, you simply follow the same principle of delegating money but spread over the frequency of your pay. The longer the time between your paycheck, the less work you have to do to delegate but the stronger discipline you need to maintain.

Try it for at least a month, and you will see the true power of delegating your funds. It really works and it’s the best thing that I have ever instilled as a habit in myself.

Good luck and all the best!

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Disclaimer: You should do your own due diligence, research and analysis before you invest any money in cryptocurrencies. Cryptocurrencies are highly volatile and classed as high-risk investments. You should never invest any money unless you’re prepared to lose your capital. The author of this article holds the said assets and might be biased towards them.

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